Questions and Answers

Questions and Answers

Question A

Customer Retention and Profitability There clearly seems to be a relationship between customer retention and profitability. For example, the whole concept of Customer Lifetime Value suggests that we need to consider the profits received from customers from all of the transactions over their lifetime. Further, we know that other organizations are constantly vying for our customers.

The relationship between product quality and retention has been extensively investigated both theoretically and empirically over the past few years in the traditional product context. In this context, product quality has usually been considered an important component of establishing and retaining customers (Ang, L., & Buttle, F. 2006). A few studies investigating the relationship between web site attributes and customer retention in different contexts found a positive relationship between the two variables.

However, in high economic crisis, customer retention is considerably an issue for companies. Consider the current global situation of financial deficit, where the spending power of individuals is reducing day by day; not even in under-developed, but also in developing countries. Even in United States and developed European countries, people are getting more conscious before spending their money over commodities or durable products (Stauss, B., et al. 2001). The increasing ratio of unemployment and inflation has drastically diminished the free-power-of-spending of the customers. Now, people consider twice before purchasing any product, and any reinforcing aspect in any other product compel customers to switch brand.

Therefore, companies are having tough time in retaining customers (Ang, L., & Buttle, F. 2006). Even giant multinational corporations that have extensive amount of financial backups to bear any sort of marketing strategy are failing to retain their customers on the same level as they used to have a couple of decades age.

The advent of I.T. infrastructure and the internet has also become a barrier in customer retention of many brands; as people have free access to different online shopping portals and tons of information - available in the internet (Stauss, B., et al. 2001). The availability of extensive knowledge is also becoming a key factor in reducing the customers' retention. Because customers are more independent to seek information, rather than reliant upon the promotional activities of the products (Ang, L., & Buttle, F. 2006). Where there are disadvantages of this intervention, it has also created a competitive environment for business to operate that has shattered the monopoly of giant market players. Though, it has reduced the profitability of various businesses and developed a rather more diverged consumer buying behavior.

Question B

Please provide comments (from your perspective) on the Piers' leadership.

Piers was a white man leading the project, whereas Omarosa was black women, working under Piers as a project team member. This reenactment has clearly demonstrated that Piers is a quite rude guy, with relatively low temperament and limited thinking capacity.

It is evident that Pier and Omarosa are two head strong individuals that will never get along. Pier addressed this right away and even compromised to set their difference until after the ...